Guitar Center Announces It Will Be Filing For Bankruptcy
Guitar Center, which is the nation's largest seller of musical instruments, is the latest retailer filing for Chapter 11 bankruptcy because of reduced sales amidst the coronavirus pandemic.
At the beginning of the pandemic, Guitar Center was forced to close many of its stores because of lockdowns and it appears that they simply never recovered. According to an article by CNN, they offered virtual guitar lessons in an attempt to recoup some of the lost revenue but it must not have been enough. And with retail sales expected to be down this holiday season, a Chapter 11 bankruptcy filing for Guitar Center seemed like the right move.
Right now, Guitar Center is on the hook to lenders by upwards of $800 million. They hope to be able to significantly reduce their overall debt so that they can restructure and become more profitable and begin to expand and grow again.
This isn't the first time that Guitar Center has demonstrated that it is struggling. In 2018, it was reported that Guitar Center was "indicating that a default event is expected in the near future."
For the time being, Guitar Center said they will continue normal day-to-day operations at all of their 269 locations. They have 9 locations in Michigan and has not announced which stores will close, if any.
What store(s) or restaurant(s) do you believe will be the next to announce bankruptcy due to the coronavirus pandemic? Let us know what you think in the comments and only time will tell how all of these companies who are struggling now will fair in the future.